I walked up to the rental car counter, insurance in hand. I thought I was prepared until the agent asked for my credit card.
You see I had just signed my first professional contract and I didn't have a credit card.
After all, I was 18, had no credit, and had just signed my first employment agreement.
It was just one example of the nuances that came with being a professional athlete. Over the years, I could name a laundry list of things that popped up where I would think, "No normal employee is dealing with this."
The reality is athlete wealth management requires expertise in the core areas (cash flow, tax, estate, and investing) as well as the areas specific to you as a professional athlete.
One of those areas is private banking for professional athletes. It is an area where having relationships, strategies, and connections pays big dividends for professional athletes.
In this blog, I am going to discuss everything professional athletes need to know about the role banking plays in money management.
Private Banking for Professional Athletes
Everyone needs a banking relationship. We often just think about these relationships as the place you go to deposit and withdraw money. In the digital age, this might be an online-only bank with no physical locations.
The solutions for retail banking relationships are cookie-cutter offerings. If you fall into a certain box, the bank can provide certain services at predetermined rates. For many, this is all that is needed.
For professional athletes, more expertise and customization are needed. Private banking provides solutions that can be catered to the needs of the individual. While it is not a "yes" to everything, it does provide far more optionality.
The most common solutions we see a private banking relationship solve are:
24/7 Support Teams
Athlete Specific Lending
Access to Preferred Rates
Credit Cards (With No Credit)
Increased Visibility & Collaboration
Let's dive into how a private banking relationship benefits professional athletes.
Early Career Solutions
The first several weeks of a professional career go by in the blink of an eye.
One minute you are dreaming about pro sports and the next you are drinking from a fire house trying to make a good first impression.
The role private banking plays early in a career has as much to do with execution as it does with speed.
Look, go into a local bank and see how long it takes to see a representative. After seeing them and them trying to sell you everything under the sun, they most likely will tell you they can't help.
The reason? Athlete contracts are weird. While every sport has some guarantees in these contracts, financial institutions (like banks) don't recognize these the same as an average W2 employee.
Said another way, an employee of your favorite local restaurant has a better chance of the bank being able to help them than you do...even if you are making millions of dollars.
The two biggest early career strategies private banking relationship helps with are:
1. Access and Understanding – You don't want to have to deal with a 1-800 number if something is going on and you want to ensure your financial team understands athletes. That means making the process as simple, smooth, and streamlined as possible.
2. Debit and Credit Cards – Most young athletes have no previous credit history so even with a large contract in hand getting proper limits can be difficult. A private banking relationship solves this issue.
I can't stress this enough but you want to make sure your entire financial team has expertise in dealing with professional athletes.
Something as simple as receiving account and card information is simplified and streamlined by a team that understands you are moving something on a monthly basis.
Mid Career Solutions
Your needs and complexities as an athlete will grow as your career progresses.
Something I always remind our athlete clients of is the fact that life changes a lot from the time you are 18 to 30.
Take me for example:
At 18: No kids, one credit card, and few needs for banking relationships.
At 30: 4 kids, multiple credit cards, and my family was looking to move for the third time.
With each move, came a new mortgage. Something that on the surface seems simple enough. High-earning professionals should have no problem getting a mortgage...right?
Well for a professional athlete that is a far different proposition. You see those contracts might be guaranteed to you but they are outside of the typical bank's box.
That is where a private banking relationship can be invaluable.
Forgive me if I sound like a broken record...you need people on your financial team who understand the ins and outs of working with professional athletes.
So remember, whether you are on your draft contract or getting ready to sign a free-agent deal, you need the right people in the right seats on the bus.
Internal Benefits
We understand the external benefits such as the strategies and access that a private banking relationship can help with. Let's talk about the internal benefits of this.
As an athlete, your financial team should consist of a team of skilled professionals. This is not a one-man show but rather a group of people as experts in their field.
One of the biggest benefits of having the right banking relationship is how that helps the internal communication among your team.
Consider this:
You sign and receive your first credit card. Is it set up, ready to go, and linked for autopay to your account?
You are in the middle of buying your first house and there is a hiccup with the title company, who do you call?
The internal communication of your financial team especially the banking team and the financial team is key. It ensures that everything runs seamlessly and nothing is slipping through the cracks.
Finding Your Solution
Now that we understand how valuable the right banking relationship can be for your career, how do you go about finding it?
Well, in short, the best way is through your financial team.
At Moment, something we pride ourselves on as athlete wealth managers is helping professional athletes build out their financial teams.
This includes a private banking relationship that ensures access, custom solutions, and ease of communication for our clients.
If your financial team does not provide this, the number one thing to look for is someone with a sports and entertainment division.
You want to be working with a team that understands your needs and can communicate in a way that makes sense to you.
If you are a future, current, or former professional athlete looking for more from your financial team, schedule a call with a founder.
Look, we get it, money can be confusing, but it doesn’t have to be.
At Moment, our mission has stayed the same since day one.
To build a firm focused on helping the people we know best, athletes and entrepreneurs.
Get in Touch With An Advisor
Frequently Asked Questions
Here are some answers to questions I received frequently about this topic.
How does Moment Private Wealth help athletes with banking? We help our athletes get set up with a private banking relationship that can handle all of their needs.
Does Moment Private Wealth help athletes set up savings and checking accounts? Our private banking relationships are specifically designed for professional athletes. This ensures our athletes are getting everything they need to have successful outcomes.
How do you separate investment accounts from everyday cash accounts? We find it important to keep our client's "spending" money separate from their investment accounts. This helps to create a more streamlined process for tracking savings, spending, and investing.
What is a reasonable budget for professional athletes? I will give you the best worst answer, it depends. For recently drafted athletes a budget of a few thousand a month is reasonable but for players making tens of millions per year or more the math can change quickly.
Can athletes get a traditional mortgage? The answer is yes but you need to make sure you are working with a bank that works specifically with athletes. This will ensure the process is smooth and streamlined.
*Moment Private Wealth offers information on tax and estate planning that is general in nature. Tax and Legal advice are not provided by Moment Private Wealth. Consult an attorney or tax professional regarding your specific legal or tax situation.
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